“One is obviously in a difficult situation when a country demonstrating a massive and concentrated effort in fiscal consolidation and structural reforms, an effort that is, obviously, politically and socially costly, sees its position threatened by enormous possibilities of contagion“. These are the concerns of Prime Minister Mario Monti, who spoke this morning by videoconference at the Economic and Financial Forum in Brussels.
Yet, according to the Professor, the risk of contagion derives more from the "overall weakness of the European system" than from the "specific weakness" of Italy. This is also why it must arrive from the Council of Europe at the end of June a package of reforms for "credible and sustainable" growth. Thanks to this tool, the markets will be convinced that growth can return, a confidence that "could be reflected in an attenuation of spreads".
Monti then underlined how Germany must "reflect deeply" on a very important issue: Europe must accelerate its growth efforts and limit the "contagion" of financial problems. Otherwise, the risk is that public support for austerity policies will disappear.
Finally, as for the ECB, the Premier said that Frankfurt's mandate "must not be changed". Even if "there is someone who would like to change its mission", he added later with probable reference to the recent Spanish affair.
